New Mexico 2025 Regular Session

New Mexico Senate Bill SB519 Compare Versions

Only one version of the bill is available at this time.

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28	28	SENATE BILL 519
29	29	57
30	30	TH LEGISLATURE
31	31	-
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33	33	STATE
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35	35	OF
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37	37	NEW
38	38
39	39	MEXICO
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42	42	FIRST SESSION
43	43	,
44	44
45	45	2025
46	46	INTRODUCED BY
47	47	James G. Townsend and George K. Muñoz
48	48	AN ACT
49	49	RELATING TO THE OIL AND GAS RECLAMATION FUND; INCREASING THE
50	50	AMOUNT OF THE TAX IMPOSED PURSUANT TO THE OIL AND GAS
51	51	CONSERVATION TAX ACT DISTRIBUTED TO THE FUND; AMENDING HOW
52	52	MONEY IN THE FUND CAN BE USED.
53	53	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
54	54	SECTION 1. Section 7-1-6.21 NMSA 1978 (being Laws 1985,
55	55	Chapter 65, Section 7, as amended) is amended to read:
56	56	"7-1-6.21. DISTRIBUTION TO OIL AND GAS RECLAMATION
57	57	FUND.--[A. With respect to any period for which the rate of
58	58	the tax imposed by Section 7-30-4 NMSA 1978 is nineteen-
59	59	hundredths percent, a distribution pursuant to Section 7-1-6.20
60	60	NMSA 1978 shall be made to the oil and gas reclamation fund in
61	61	an amount equal to two-nineteenths of the net receipts
62	62	attributable to the tax imposed under the Oil and Gas
63	63	.229029.1 underscored material = new
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90	90	Conservation Tax Act.
91	91	B. With respect to any period for which the total
92	92	rate of the tax imposed on oil by Section 7-30-4 NMSA 1978 is
93	93	twenty-four hundredths percent ] A distribution pursuant to
94	94	Section 7-1-6.20 NMSA 1978 shall be made to the oil and gas
95	95	reclamation fund in an amount equal to [nineteen and seven-
96	96	tenths percent of] the net receipts attributable to the tax
97	97	imposed under the Oil and Gas Conservation Tax Act."
98	98	SECTION 2. Section 70-2-38 NMSA 1978 (being Laws 1977,
99	99	Chapter 237, Section 5, as amended) is amended to read:
100	100	"70-2-38. OIL AND GAS RECLAMATION FUND ADMINISTERED--
101	101	PLUGGING WELLS ON FEDERAL LAND--RIGHT OF INDEMNIFICATION--
102	102	ANNUAL REPORT--CONTRACTORS SELLING EQUIPMENT FOR SALVAGE.--
103	103	A. The oil and gas reclamation fund shall be
104	104	administered by the oil conservation division of the energy,
105	105	minerals and natural resources department. Expenditures from
106	106	the fund [may] shall be used by the director of the division
107	107	only for the purposes [of ] provided by Subsection B of this
108	108	section.
109	109	B. The greater of forty million dollars
110	110	($40,000,000) or five percent of the average of the year-end
111	111	market values of the fund for the immediately preceding three
112	112	calendar years shall be dedicated for:
113	113	(1) employing the necessary personnel to
114	114	survey abandoned wells, well sites and associated production
115	115	.229029.1
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143	143	facilities; and
144	144	(2) preparing plans for administering and
145	145	performing the plugging of abandoned wells that have not been
146	146	plugged or that have been improperly plugged and for the
147	147	restoration and remediation of abandoned well sites and
148	148	associated production facilities that have not been properly
149	149	restored and remediated [and
150	150	(2) supporting energy education throughout the
151	151	state in an amount not to exceed one hundred fifty thousand
152	152	dollars ($150,000) annually ].
153	153	[B.] C. The director of the oil conservation
154	154	division of the energy, minerals and natural resources
155	155	department, as funds become available in the oil and gas
156	156	reclamation fund, shall reclaim and properly plug all abandoned
157	157	wells and shall restore and remediate abandoned well sites and
158	158	associated production facilities in accordance with the
159	159	provisions of the Oil and Gas Act and the rules and regulations
160	160	promulgated pursuant to that act. The division may order wells
161	161	plugged and well sites and associated production facilities
162	162	restored and remediated on federal lands on which there are no
163	163	bonds running to the benefit of the state in the same manner
164	164	and in accordance with the same procedure as with wells drilled
165	165	on state and fee land, including using funds from the oil and
166	166	gas reclamation fund to pay the cost of plugging. When the
167	167	costs of plugging a well or restoring and remediating well
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196	196	sites and associated production facilities are paid from the
197	197	oil and gas reclamation fund, the division is authorized to
198	198	bring a suit against the operator or district court of the
199	199	county in which the well is located for indemnification for all
200	200	costs incurred by the division in plugging the well or
201	201	restoring and remediating the well site and associated
202	202	production facilities. Any funds collected pursuant to a
203	203	judgment in a suit for indemnification brought under the Oil
204	204	and Gas Act shall be deposited in the oil and gas reclamation
205	205	fund.
206	206	[C.] D. The director of the oil conservation
207	207	division of the energy, minerals and natural resources
208	208	department shall make an annual report to the secretary of
209	209	energy, minerals and natural resources, the governor and the
210	210	legislature on the use of the oil and gas reclamation fund.
211	211	[D.] E. Contracts for plugging, reclamation and
212	212	energy education pursuant to this section shall be entered into
213	213	in accordance with the provisions of the Procurement Code. A
214	214	contractor employed by the oil conservation division of the
215	215	energy, minerals and natural resources department to plug a
216	216	well or restore or remediate a well site or associated
217	217	production facility is authorized to sell the equipment and
218	218	material or product that is removed from the well, site or
219	219	facility and to deduct the proceeds of the sales from the costs
220	220	of plugging, restoring or remediating.
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249	249	[E.] F. As used in this section, "associated
250	250	production facilities" means those facilities used for,
251	251	intended to be used for or that have been used for the
252	252	production, treatment, transportation, storage or disposal of
253	253	oil, gas, brine, product or waste generated during oil and gas
254	254	operations or used in the production of oil and gas if that
255	255	facility is, has been or would have been subject to regulation
256	256	by the oil conservation division of the energy, minerals and
257	257	natural resources department or the oil conservation commission
258	258	pursuant to the Oil and Gas Act or the Water Quality Act."
259	259	SECTION 3. EFFECTIVE DATE.--The effective date of the
260	260	provisions of this act is July 1, 2025.
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262	262	.229029.1